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DALLAS--(BUSINESS WIRE)--Pioneer Natural Resources Company (NYSE:PXD) (“Pioneer” or “the
Company”) today announced that the Company has signed an agreement with
Sinochem Petroleum USA LLC, a U.S. subsidiary of the Sinochem Group
(“Sinochem”), to sell 40% of Pioneer’s interest in approximately 207,000
net acres leased by the Company (“joint interest area”) in the highly
prospective horizontal Wolfcamp Shale play in the southern portion of
the Spraberry Trend Area Field for a total price of $1.7 billion. At
closing, Sinochem will pay $500 million in cash to Pioneer, before
normal closing adjustments, and will pay the remaining $1.2 billion by
carrying a portion of Pioneer’s share of future drilling and facilities
costs (“drilling carry”).

The transaction is expected to close during the second quarter of 2013,
subject to customary governmental approvals. Under the agreement,
Sinochem will acquire approximately 82,800 net acres of leasehold held
by Pioneer for all Wolfcamp depths and deeper horizons. Pioneer retains
60% of its interest in the Wolfcamp depths and deeper horizons, with
Sinochem receiving 40% of Pioneer’s interest. Pioneer will continue as
operator and will conduct all leasing, drilling, completion, operations
and marketing activities in the joint interest area. The joint interest
area covers defined portions of Upton, Reagan, Irion, Crockett and Tom
Green Counties in Texas. Pioneer retains its current working interests
in all horizons shallower than the Wolfcamp horizon.

In addition to funding its own drilling obligations for the horizontal
Wolfcamp Shale, Sinochem has agreed to fund 75% of Pioneer’s portion of
drilling and facilities costs after closing until the $1.2 billion of
drilling carry is fully utilized. Pioneer has six years to utilize the
drilling carry, subject to extension under certain circumstances. At
closing, Sinochem will pay its 40% share of net expenditures in the
joint interest area from the December 1, 2012 effective date of the
transaction to the closing date. Pioneer and Sinochem have agreed to a
development plan which forecasts the drilling of 86 horizontal Wolfcamp
Shale wells during 2013, increasing to 120 wells in 2014 and 165 wells
in 2015.

To the extent Sinochem elects to participate in any vertical wells that
are drilled in the joint interest area after the effective date,
Sinochem will receive its share of production and costs from the
Wolfcamp and deeper horizons based on the anticipated reserve
contribution from the Wolfcamp and deeper intervals relative to
anticipated reserves from all completed intervals. Pioneer’s and
Sinochem’s participation in vertical wells will be based on each party’s
interest without any drilling carry being applied. Pioneer will retain
100% of its existing vertical production in the joint interest area.

Pioneer has successfully drilled and completed 39 horizontal wells in
the Wolfcamp Shale joint interest area through December 31, 2012. Of
these 39 wells, 22 wells were on production and 4 additional wells were
flowing back. Of the 22 wells on production, 20 wells were completed in
the B interval and 2 wells were completed in the A interval. Pioneer’s
net horizontal Wolfcamp Shale production in the joint interest area
averaged approximately 2,000 barrels oil equivalent per day (BOEPD) in
2012, with a year-end exit rate of approximately 5,000 BOEPD.

Scott Sheffield, Chairman and CEO, stated, “We are very excited to work
with Sinochem, a global energy and chemicals leader, in the southern
horizontal Wolfcamp Shale area, and are pleased that they share our
confidence in accelerating the development of this large, oil-rich
acreage position. This accelerated development will add significant
production and reserves for Pioneer while enhancing shareholder value.
It will also reduce our country’s dependence on foreign oil imports,
create thousands of new U.S. jobs, further stimulate the Permian Basin
economy and add significant tax revenues for use by local communities,
schools, the state and the nation.”

Consistent with the announced transaction with Sinochem, the
responsibilities for certain Executive Vice Presidents (EVPs) who are
members of Pioneer’s Management Committee will be rebalanced. These
changes are effective immediately.

William F. Hannes, formerly EVP South Texas Operations, will become EVP
of the newly formed Southern Wolfcamp Asset Team. This asset team will
focus on executing the drilling program in the horizontal Wolfcamp Shale
joint interest area.

Danny L. Kellum, EVP Permian Operations, will focus his attention on
Pioneer’s remaining Permian activities, with executive responsibility
for the Permian Asset Team and Permian integrated services. This asset
team will focus on executing the horizontal and vertical drilling
programs over the remainder of Pioneer’s Permian acreage.

Jay P. Still, EVP Domestic Operations, will add executive responsibility
for Pioneer’s South Texas operations to his current responsibilities for
the Company’s Mid-Continent, Rockies, Alaska and Barnett Shale assets.

BofA Merrill Lynch served as financial advisor and Vinson & Elkins LLP
served as legal advisor to Pioneer on the transaction.

Further information regarding the horizontal Wolfcamp Shale transaction
with Sinochem will be discussed during Pioneer’s quarterly conference
call on Thursday, February 14, 2013, at 9:00 a.m. Central Time, when
Pioneer will also discuss its fourth quarter and full-year 2012
financial results and 2013 Capital Budget, with an accompanying
presentation. Instructions for listening to the call and viewing the
presentation are shown below.

Internet: www.pxd.comSelect
“Investors,” then “Earnings & Webcasts,” to listen to the discussion,
view the presentation and see other related material.

A replay of the webcast will be archived on Pioneer’s website. A
telephone replay will be available through March 11, 2013 by dialing
(888) 203-1112, confirmation code: 7431932.

Pioneer Natural Resources Company is a large independent oil and gas
exploration and production company, headquartered in Dallas, Texas, with
operations in the United States. For more information, visit Pioneer’s
website at www.pxd.com.

Except for historical information contained herein, the statements,
charts and graphs in this presentation are forward-looking statements
that are made pursuant to the Safe Harbor Provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements and
the business prospects of Pioneer are subject to a number of risks and
uncertainties that may cause Pioneer's actual results in future periods
to differ materially from the forward-looking statements. These risks
and uncertainties include, among other things, volatility of commodity
prices, product supply and demand, competition, the ability to obtain
environmental and other permits and the timing thereof, other government
regulation or action, the ability to obtain approvals from third parties
and negotiate agreements, including development agreements, with third
parties on mutually acceptable terms, litigation, the costs and results
of drilling and operations, availability of equipment, services,
resources and personnel required to complete the Company's operating
activities, access to and availability of transportation, processing and
refining facilities, Pioneer's ability to replace reserves, implement
its business plans or complete its development activities as scheduled,
access to and cost of capital, the financial strength of counterparties
to Pioneer's credit facility and derivative contracts and the purchasers
of Pioneer's oil, NGL and gas production, uncertainties about estimates
of reserves and resource potential and the ability to add proved
reserves in the future, the assumptions underlying production forecasts,
quality of technical data, environmental and weather risks, including
the possible impacts of climate change, the risks associated with the
ownership and operation of an industrial sand mining business and acts
of war or terrorism. These and other risks are described in Pioneer's
10-K and 10-Q Reports and other filings with the Securities and Exchange
Commission. In addition, Pioneer may be subject to currently unforeseen
risks that may have a materially adverse impact on it. Pioneer
undertakes no duty to publicly update these statements except as
required by law.